Failing to file the 142(d)(7) certification is a $100 penalty per failure and does not by itself make the bonds taxable

bond.reporting.form_8703_failure_penalty_and_bond_status · v1.0.0

A failure to provide the certification required by 142(d)(7) at the prescribed time carries a penalty of $100 for each failure, payable on notice and demand and in the same manner as tax, by the person failing to provide the certification, unless the failure is shown to be due to reasonable cause and not to wilful neglect. The statute is explicit that such a failure does NOT affect the tax-exempt status of any bond. This is the one place in the 142(d) regime where a missed filing is only a penalty. It is a different consequence from the failure Form 8703 reports on: a missed FILING costs $100, while the project failing to meet the requirements of 142(d) - which the form is the vehicle for disclosing - puts the bonds' exemption in issue. Conflating the two understates the second risk by several orders of magnitude.

Confidence

high

Effective from

1986-10-22

Consequence model

statutory penalty

Last reviewed

2026-08-30